Abstract

Purpose – This article explores how understanding the challenges faced by companies’ attempts to create competitive advantage through their human resources and HRM practices can be enhanced by insights into the concept of strategic groups within industries. Based within the international hotel industry this study identifies how strategic groups emerge in the analysis of HRM practices and approaches. It sheds light on the value of strategic groups as a way of readdressing the focus on firm and industry level analyses.

Design Methodology/Approach – Senior human resource executives and their teams across eight international hotel companies (IHCs) were interviewed in corporate and regional headquarters, with observations and the collection of company documentation complementing the interviews.

Findings – The findings demonstrate that strategic groups emerge from analysis of the HRM practices and strategies used to develop hotel general managers (HGMs) as strategic human resources in the international hotel industry. The value of understanding industry structures, dynamics and intermediary levels of analysis are apparent where specific industries place occupational constraints on their managerial resources and limit the range of strategies and expansion modes companies can adopt.

Research limitations/implications - This study indicates that further research on strategic groups will enhance the theoretical understanding of strategic human resource management (SHRM) and specifically the forces that act to constrain the achievement of competitive advantage through human resources. A limitation of this study is the dependence on the human resource divisions’ perspectives of realising international expansion ambitions in the hotel industry.

Practical implications - This study has implications for companies’ engagement with their executives’ perceptions of opportunities and threats, and suggests companies will struggle to achieve competitive advantage where such perceptions are consistent with their competitors.

Originality/value - Developments in strategic human resource management have relied upon the conceptual and theoretical developments in strategic management, however, an understanding of the impact of strategic groups and their shaping of SHRM has not been previously explored.